Parties clash over Labour's 'train crash' reforms to social care as health secretary kills off death tax

The Tories condemned the Government's social care blueprint as a 'train crash' today as Labour pledged not to introduce a compulsory 'death tax' to help pay for long-term elderly care for at least five years.

Health Secretary Andy Burnham said he had made the 'momentous' decision to create an NHS-style national care service for the elderly paid for by compulsory contributions from every taxpayer.

But he will attempt to kick the controversial idea into the long grass by
promising no new levy would be imposed until after the next poll in
2015.

And in a landmark White Paper, to be unveiled today, he will say for the first time that if Labour is re-elected, no pensioner will have to stump up the charges for more than two years in a care home.

Mr Burnham hopes that by promising the state would step in, it will
end the scandal of elderly people having to sell their homes to pay for
residential care.

Delayed: Burnham said the 'death tax' to help pay for long-term elderly care will be put off for at least five years

Plans for compulsory 10 per cent levy proved hugely unpopular
with the public after it emerged that millions of middle income
families would face the tax on their estates to pay for it - whether or
not their loved one had required any care.

It would have left the relatives of earners with estates worth £500,000 with a bill of £50,000.

This would be on top of an inheritance tax bill of £70,000.

The Health Secretary's decision to delay any decision whether to
impose a levy until after 2015 will lead to accusations that he is
cynically attempting to defuse death tax an election issue.

Critics say Labour has done nothing to sort out the scandal of
elderly people having to sell their homes during its 13 years in power.
The further delay will mean that even if Labour wins, reforms will not come into effect
until 18 years after Tony Blair promised reform in his 1997 manifesto.

Share this article

'The Government is in complete retreat and they have ended up with not a White Paper but frankly a train crash,' shadow health secretary Andrew Lansley said today.

'We seem to have arrived at the point where Andy Burnham is saying he wants everyone to have free care but he doesn't know ho to pay for it.'

Defending his alternative proposals, he said: 'The point is nobody would be forced to sell their home to pay for care. They would have the option to get peace of mind for just £8,000.'

Mr Burnham's interim solution to the care home scandal is to
cap the amount of time people pay for the care costs in residential
care.

After two years, the Government will meet the full nursing
care costs of care - but not the accommodation costs. The average
length of stay in a care home is around two years - but the two-year
cap will save many families thousands of pounds and could help them avoid selling their home. A year in a care home costs around £30,000.

Mr Burnham told the Daily Mail that the system had to be
reformed, because under the current system thousands were forced to pay
a 'dementia tax', 'where the more vulnerable you are, the more you
pay'.

He said: 'While only 20 per cent of people will pay huge sums
of money towards care costs, everyone can expect to pay something.

'So in effect, a compulsory tax on vulnerability already
exists. It's just that no one knows how much they will pay ... it's a
cruel lottery where people gamble with their homes and savings.'

The White Paper will also contain plans to end the postcode
lottery of elderly care, with different councils applying different
standards on who can have free care.

In 2015, or soon after, a National Care Service will begin -
with a promise of comprehensive social care, free at the point of use.
But no decision on how it should be paid for will be made until after
2015.

It emerged earlier this month that Mr Burnham was considering
three major options for raising money for elderly care are: a 10 per
cent levy to be paid from an estate on death; means-tested amounts to
be paid across the whole of retirement; or the option of deferring
pensions for three years to pay into a new National Care Service.

But the White Paper will make it clear that the ideal situation is to move towards a compulsory levy.

Jane Ashcroft, chief executive of care home provider Anchor,
said the Government needed to get on and deliver reform. 'Older people
with care needs ... don't want to have to wait years for an answer,'
she added.

Conservative health spokesman Andrew Lansley said: 'This is
typical spin from a Labour Government that refuses to be straight with
people.